Net Shoppers Just Say 'Nyet' to Taxes

Nearly 60% of consumers say they would make fewer online purchases if they had to pay sales tax, according to a new survey by BizRate.com (http://www.bizrate.com).

"The BizRate.com data clearly show that Internet consumers are tax conscious and want the choice whether or not to pay the tax at the point of purchase," says Ben Isaacson, executive director of the Association for Interactive Media,.which co-sponsored the survey. "If the Internet is to maintain its increasing contribution to the state and federal economies, legislators must listen to consumer response."

The survey, BizRate's third in a series of taxation studies, compiled feedback from nearly 17,000 online buyers. The findings will be introduced tomorrow at a meeting of the AdvisoryCommission on Electronic Commerce in San Francisco.

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The survey shows that taxes and tariffs would have a greater negative impact on foreign merchants. Specifically, 30% say they would never buy from an online foreign merchant if they had to pay tariffs. More than half say they would make fewer purchases from foreign merchants.

Income, age, gender and even experience with Internet shopping affect how shoppers see Internet taxes. Buyers with incomes under $20,000 say they're less likely to make online purchases if sales tax is charged. Among shoppers under 35, 63% are more likely to reduce their online purchases because of sales tax than are older buyers (57%). Men (65%) are more likely than women (53%) to make fewer online purchases if faced with sales tax. And experienced online buyers (60%) say they would be more likely to reduce purchases due to sales tax than first-time buyers (50%).